Binance CEO Changpeng Zhao has endorsed a fresh entrant into the cryptocurrency exchange arena.
The exchange, called EDX, has garnered support from renowned financial institutions, including Citadel Securities, Fidelity Investments, and Charles Schwab. CZ took to Twitter to share his enthusiasm, posting a screenshot of a Wall Street Journal article spotlighting the exchange’s remarkable timing.
In the midst of increasing regulatory scrutiny, CZ commends the emergence of EDX, asserting that heightened competition in the crypto space brings positive outcomes. As the CEO of a prominent crypto exchange, CZ does not perceive emerging players as a threat due to his broader vision for the industry.
Binance’s SEC Settlement Fuels EDX’s Noncustodial Crypto Exchange Rise
Despite CZ Binance’s recent relief following a settlement with the US Securities and Exchange Commission (SEC), the regulatory body remains cautious of crypto developments within the country. EDX, positioning itself as a “noncustodial” platform, will initially offer trading exclusively in Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH).
The company plans to introduce a clearing house later this year to facilitate trade settlements. Nevertheless, even after the clearing house becomes operational, EDX intends to rely on third-party banks and a crypto custodian to safeguard customer assets, according to the Wall Street Journal.
This strategic move by EDX comes at a time when both Binance, including CZ Binance, and Coinbase are grappling with legal action from the SEC. The regulatory scrutiny surrounding crypto exchanges primarily stems from SEC Chairman Gary Gensler’s assertion that most cryptocurrencies should be classified as securities falling under the agency’s purview.
Chairman Gensler has recently emphasized the importance of investor protection, underscoring the need to prevent the crypto markets from causing harm to them.
In addition to Citadel Securities and Fidelity Investments, EDX has secured investments from notable entities such as Miami International Holdings, DV Crypto, GTS, GSR Markets LTD, and HRT Technology in a recent funding round. The backing from these prominent US firms further solidifies EDX’s position in the competitive landscape of the cryptocurrency exchange industry.